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The case will be useful in helping learners: to appreciate concepts in and develop the necessary understanding to apply relevant theories in crisis communications; to identify communications issues along with the evolution of a crisis; to understand the importance and role of a crisis communications team; and to develop skills in writing a crisis communications plan.

The case is a narration of the experiences of the Kenya Red Cross Society (KRCS) as it launched the Kenya drought appeal in March 2019, and the unexpected media and public backlash that ensued. The background is that of an unusual-yet-previously-predicted dry spell, consequent drought and famine, alleged famine-related deaths, mixed signals from the national and county government and a hitherto well-regarded institution (the KRCS) coming in to launch an appeal aimed at raising funds to help alleviate the effects of the prolonged drought and consequent famine in the northern parts of the country. Unfortunately, a major media and public backlash that was not foreseen by KRCS ensued, and it threatened the reputation and very existence of the organization. Drawing on interviews and secondary material in the public domain, the case focuses on how the KRCS navigates the media and public backlash that ensued following the funding appeal. The case is interesting because of the type of organization involved (a not-for-profit institution set up as auxiliary to the government and of good repute), the nature of the problem (reputational crisis and attendant risk management), the setting (a LMIC in sub-Saharan Africa) and the level of analysis (organizational rather than individual decision-making).[AQ1]

Masters level – MBA, Executive MBA, Master’s in Public Management, Master’s in Communication and/or similar courses.

Teaching notes are available for educators only.

CSS 11: Strategy.

After completing this case, students should be able to: identify and compute relevant cash flows in relation to a real estate project and compute the net present value (NPV). Determine the target return or cost of capital (by looking at historical economic indicators). Design or formulate a sensitivity analysis to determine the drivers of the project value. Evaluate real estate and other investments taking qualitative and quantitative factors into consideration. Demonstrate the computation of a break-even rate to determine the minimum or maximum revenue or cost required for a project to be viable.

This case study is about the Golden Beak Securities Pension Fund that wanted to invest in a Hostel Project in one of the universities in Ghana. Most universities in Ghana faced an acute shortage of on-campus accommodation. Also, the Government of Ghana, in 2017, implemented a programme to make Senior High School in Ghana free. This was expected to increase the number of students who will enter the existing universities. The project was therefore seen as strategic, as it would help ease the pressure of on-campus accommodation while providing diversification for the pension fund. As part of the investment committee’s (IC) quest to improve the skill set available to it, especially in relation to real estate investments, Esi Abebrese was appointed as one of the members of the IC of GSB. Her main task was to collect information on key macroeconomic variables, as well as granular information on project costs and revenues and conduct investment appraisal. Esi was scheduled to make a presentation to the IC on the 15th of October 2019 following which the Committee will debate and make a decision. The project had an estimated cost of GH¢52m with a total number of 3,424 student beds and ancillary facilities. Undertaking the project required moving funds from investments in money market securities with one of the banks in Ghana. The investments in the money market securities were currently yielding about 16% a year. The determination of the cost of capital was critical and Esi and Nana eventually settled on a long-term weighted average cost of capital of 14%. This was after considering the trend of inflation, monetary policy rates, treasury rates, stock market returns and a report on returns on commercial real estate properties in Ghana. An exit capitalisation rate of 20% was also estimated for the purposes of determining the value of the property at the end of the investment horizon. Esi also obtained estimates of cost and revenue for the project and proceeded to carry out a feasibility analysis on the project. This consisted of an NPV analysis and sensitivity analysis on various factors to determine the drivers of the project value. The IC had to take several factors (both quantitative and qualitative) into consideration before making a decision. Esi believed that these factors included the diversification of the fund’s assets, the return on investment, potential oversupply of hostel accommodation, the social responsibility of providing student accommodation and the impact of any prolonged shutdown of the university.

Masters/advanced undergraduate.

Teaching Notes are available for educators only. Please contact your library to gain login details or email support@emeraldinsight.com to request teaching notes.

CSS 1: Accounting and Finance.